There are two ways that consumers can be harmed by an on-line profile. First, it can reveal information a person might wish to keep secret. Second, the information itself can be incorrect or incomplete, causing the revealed picture to be not just invasive, but unfair and misleading.

INTERNET PROFILING COULD LEAD TO A VIRTUAL TRUMAN SHOW FULL OF DISCRIMINATION

The unnerving prospect, according to Paul Saffo, a director for the Institute for the Future, is that "we will all be players in what could be a fairly inaccurate virtual Truman Show."

At stake, technologists say, is far more than who gets which Internet marketing pitches. Profiling, they say, could be employed to determine who gets -- and who is excluded from -- all kinds of opportunities like jobs, housing and education.

Here's an outline of how online profiling works: Let's say I'm looking for a first-edition copy from the wildly popular Harry Potter book series. I go to AltaVista and search for sites that sell rare books. By storing a snapshot of my search, the company that has placed the ever-present banner ad at the top of AltaVista's page--in this case, DoubleClick--has taken the first step in building a profile of my surfing habits. From this point on (until I change browsers, buy a new computer, or delete my cookies file), DoubleClick can track my browser's activity across all sites on which it handles banner ad placement.

And since DoubleClick controls some 60 percent of the banner ad market, the company has a long reach and extensive information on consumers. Every time I enter a new search term on AltaVista, check my investment portfolio at Quicken.com, compare fares at Travelocity.com, or visit any of the DoubleClick Network's hundreds of client sites (including PC World Online), this profiling powerhouse collects more data about where I go and what I do online.

ONLINE PROFILING IS A CLEAR VIOLATION OF PRIVACY

Robert Wright, President of Zero-Knowledge Systems of Montreal. The Toronto Star December 23, 1999, TITLE: PROTECTING PRIVACY ONLINE // acs-EE2001

Frankly the practice gives me the creeps. It is a clear-cut invasion of our privacy and I would like to see it at least temporarily banned while the public and politicians have a chance to put it under the microscope and decide whether it is acceptable.

WEB SITES USE ON-LINE PROFILING TO COLLECT PERSONAL INFORMATION

Major R. Ken Pippin, Chief of Cadet Disenrollments at HQ USAFA/JA, United States Air Force Academy, Colorado. He is a member of the Bar of the State of Arkansas., "Consumer Privacy on the Internet: It's "Surfer Beware"", The Air Force Law Review, 1999, 47 A.F. L. Rev. 125, EE2001-JGM, p.129

Web sites can also collect information about consumers through hidden electronic navigational software that capture information about site visits, including web pages visited and information downloaded, the types of browser used, and the referring web site's Internet address. n24 These types of cookie files are also deposited on a computer when a consumer visits the web site. The files enable a web site to recognize a repeat customer and offer products tailored to the consumers interests. This practice, known as on-line profiling, is best described as aggregating information about consumers' preferences and interests gathered primarily by tracking their movements on-line and, in some cases, combining this information with personal information collected directly from consumers or contained in other databases. n25

Business is not the only threat: governments can use code to track their citizens far more efficiently than ever before. And they can do so by stealth, Prof Lessig writes, pointing to little-remarked US legislation that requires telephone companies to "code" their networks in a way that facilitates wire-tapping. "Some codes protect privacy better than others. So the choice among codes becomes a choice among values."

That makes codewriters into lawmakers, writing the rules of cyber-society, often without any democratic input or accountability - and, crucially, without facing some of the barriers that impose practical constraints on regulation in the offline world.